The California Legislative Analyst’s Office says the state has spent $37 billion on homelessness since 2019 and undercounts the homeless.
It also urges delaying one of Gov. Gavin Newsom’s key programs until data proves its effectiveness.
A 2023 UC San Francisco report found 34% of homeless individuals in California are not from California, meaning state taxpayers may have covered $12.6 billion since 2019 on homeless spending for individuals from other states or nations.
“A long-standing way that California and the rest of the United States have estimated the number of people experiencing homelessness is through a point-in-time count,” wrote the LAO. “Since the count is only a snapshot of people experiencing homelessness on one given night in a year (typically in late January) and those conducting the count may miss individuals who are hidden from view at the time (such as people sleeping in a secluded area), the homelessness data collected is an undercount.”
RAND Corp., a government consulting firm, reached similar conclusions when it found an increase in Los Angeles homelessness despite the point-in-time count finding a decrease.
“These once-per-year counts likely represent a significant undercount of unsheltered homelessness. Some of these reasons, such as conducting the count on a winter night, represent explicit policy choices,” wrote RAND experts. “Others, such as the use of lightly trained volunteers, represent logistical constraints that are difficult to address in a large metropolitan area.”
The new report on Gov. Gavin Newsom’s Encampment Resolution Funding program — meant to clear encampments while moving homeless to housing of some kind — says since the program was created in fiscal year 2021-2022, there is little data on the program and its effectiveness.
“The Legislature is not yet able to determine whether — and where — the funds are achieving their intended goal of encampment resolution,” wrote the LAO. “In addition, without data such as the number of people transitioned from an encampment to permanent housing, the Legislature is unable to assess the cost-effectiveness of the program.”
The LAO also noted the “State Auditor reached a similar conclusion in its April 2024 report, which attempted to evaluate ERF’s cost-effectiveness based on Round 1 grants.”
While $856 million has been awarded for ERF grants thus far, the LAO found $598 million is yet to be spent. ERF recipients for all but the current, ongoing round for fiscal year 2024-2025 are required to submit reports on their spending and results by April 1. Those receiving funds in the current round have until April 1, 2026 to file their progress reports.
The LAO recommended that the legislature wait for these reports to come in before funding another round of ERF grants, citing a need for evidence this program works.
“We recommend the Legislature wait to decide on funding another ERF round until it receives compelling evidence that program goals are being met,” wrote the LAO.
